PayPal acquires bill payment processor TIO Networks for $233 million

PayPal has announced its intent to purchase multi-channel bill payment processing and receivables management company TIO Networks for $233 million in cash, or $2.56 per share, which represents a 25.2 percent premium over what the company has been trading at on average over the past three months.

For those not familiar, TIO is a bill payment processor that services some 14 million consumer accounts. Many of TIO’s customers are described as “financially underserved” and thus, may not have access to traditional financial services like those offered by a bank or credit union.

Without a debit card or checkbook, consumers with cash in hand can use TIO’s approximately 900 operated self-service kiosks and approximately 65,000 retail walk-in locations to pay their telecom, wireless, cable and / or utility bills.

PayPal CEO and President Dan Schulman pointed to the World Bank Global Findex (2014) which noted that more than two billion people worldwide do not have affordable access to basic financial services, making it difficult and expensive for consumers to carry out basic financial tasks such as paying bills. By acquiring TIO and integrating bill payment into their global payments platform, he said, PayPal is adding another key service in its efforts to become a part of a consumer’s everyday financial life.

Bill Ready, PayPal COO, told TechCrunch that his company has a chance with the acquisition to create a bridge for underserved people into the digital world.